Category: CRM Failures

Between the decision to implement an enterprise-wide software solution and it implementation and acceptance, lies perhaps the most treacherous ground in the corporate IT landscapeâ€¦

Research group after research group report that an extraordinarily high percentage of software projects either fail to meet their goals after completion, are delivered over-budget or late, or are simply cancelled outright.

Gartner says half the projects in their study exceeded their initial budget tolerance by 200%. Standish Group suggests fully 1/3 of software projects are scotched before a single user has drawn benefit from the application.

CRM â€“ Customer Relationship Management â€“ projects are no different; they are subject to the same torques and tensions that tear other projects apart.In fact, the numbers are higher with CRM projects; studies show up to 70% of CRM projects fail. What is the source of so many CRM failures? Are there characteristics of CRM projects that make them especially vulnerable? More important, what are the remedies? Continue reading “Why CRM Fails”

If we look at why CRM initiatives fail, we can get a sense of why success will require better planning. Perhaps you’ve read the myriad of articles that state the high failure rate of CRM projects. Typically, survey results say that anywhere from 60% to 80% of CRM projects fail. What exactly do these studies mean when they use the term “failure”? In these cases, failure means,

There can be many reasons why CRM initiatives fail but here we’re going to focus specifically on six of them pertaining to small businesses and startups. Brian Halligan has been implementing and using CRM systems for his whole career and has some good points.

"Most small businesses I deal with have either tried and failed on a CRM
implementation or are getting marginal value from what they consider a
sunk cost in software and human brain-damage from their implementation."

Bad workmen blame their tools and bad salespeople blame their CRM, according to research from Microsoft Business Solutions.

The findings of a poll of 100 SME organisations with CRM implementations revealed that while 60% of sales directors insist that CRM is fundamental to their sales processes, a quarter have lost customers directly through their ineffective use of CRM technology.

This week I went to a new bank to open a savings account. After telling the bank teller why I was there, I was told that someone would be with me shortly. As I took a seat, I noticed the tellers give each other a high-five and say, â€œThatâ€™s two new accounts already!â€ Boy, did I feel special.

Soon, the manager emerged to shake my hand and lead me to his office. When I told him I wanted to open a saving account, he smiled and asked with which bank I had my checking account. Confused by the question, I cautiously explained that my other accounts were with different banks.

Here’s what keeps CEOs awake at night: Their companies are spending billions on customer service , loyalty programs, new CRM initiatives, and technology tools. Yet customer satisfaction levels are decreasing, defection rates are increasing, and most CRM programs are forecast to fail. After decades of relentless effort in putting the customer first, it seems that the holy grail of customer delight continues to elude big and small corporations alike. Probably David Ogilvy was on to something when he said, "the customer is not a moron: she is your wife." Today’s customer seems determined to be a demanding mistress, disrupting best laid plans and destroying the bottom line.

For years enterprises have tried to combat customer service issues with technology.

In some cases, the organizations do not have a central location to keep all of a customerâ€™s data. The e-mail requests are stored in one location while records of phone conversations are located someplace else. When this happens the call center manager approaches the IT manager and says, â€œWe need a database.â€ The IT manager then researches the latest in knowledge-bases and buys the technology that will best fit the current architecture.

But there can lead to trouble.

After spending quite a bit of time and money getting this knowledge base up and running, the system still doesnâ€™t seem to run smoothly. Data is not input regularly so the information is often stale, incomplete or inaccurate. The call center manager then goes back to the IT manager and complains that the CRM solution is not working properly. The IT manager protests that the technology is working fine, but it is the fault of the agents for not using it properly. The ensuing result of the project is another piece of technology not being used to the best of its ability and the gap between IT and the business user is driven further apart.

You are now probably asking how this problem could be resolved, as it seems like a vicious cycle. The solution is actually quite simple: Process planning and automation. Customer service failures are often a process problem rather than a technology one. CRM solutions are meant to carry out simple tasks â€“ automatic responses to e-mails, online searches offerings, the logging and maintenance of client information, and so on. However, behind each of these tasks lies a laundry list of human workflow processes that need to be captured and automated before the CRM technology can work properly.